Equity Alert
Infosys falls 4% post Q2 results, company cuts sales growth outlook
This story was originally published at 11:48 IST on 26 October 2026
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Equity Alert: Infosys falls 4% post Q2 results, co cuts sales growth outlook
MUMBAI--1140 IST--Shares of Infosys fell over 4% to an intraday low of INR 1,107 after it cut its revenue growth guidance for the financial year 2026-27 (Apr-Mar). The information technology giant cut its revenue growth guidance to 1-2% in constant currency terms from 1.5-3.0% projected earlier. The company, however, retained its operating margin guidance at 20–22%. Multiple analysts expect Infosys to underperform its large-cap and mid-cap peers in the IT space.
The reduced guidance has affected the sentiment towards the stock. Analysts are mixed on how deals will shape up through the rest of this financial year, and the company's margins are seen as being adversely impacted. Further, the company's net profit for the September quarter rose marginally on quarter to INR 78.23 billion but fell short of the Street's estimate of INR 79.33 billion.
The second half of FY27 is expected to be weaker than has historically been witnessed for the information technology major and, hence, the outlook on the company will remain weak in the near term, Nuvama Institutional Equities said. However, the stock's inexpensive valuations limit downside. The brokerage changed its estimates for the company's earnings per share by 0.1% for FY27 and by 0.5% for FY28. Nuvama downgraded the stock to "hold" from "buy", and cut its target price by 4% to INR 1,200. Looking ahead, there is likely going to be a ramp-down of deals, leading to a weak exit rate for FY27.
At 1052 IST, shares of Infosys traded 1% lower at INR 1,143 apiece on the National Stock Exchange. Over 12 million shares of the company have changed hands on the exchange so far, which is over 7% higher than the three-month daily average volume traded. (Deesha Jadhav)
Equity Alert: Dr Reddy's rises 4?ter Q2 PAT, EBITDA beat view
MUMBAI--1130 IST--Shares of Dr. Reddy's Laboratories rose almost 4% to hit an over-three-month high of INR 1,275.80, after the company's earnings for the September quarter surprised analysts positively. The stock was among the top gainers in the Nifty 50 and it was lending support to the Nifty Pharma index.
A sharp expansion in the company's earnings before interest, taxes, depreciation, and amortisation margin on quarter, Elara Securities (India) said. The company's margin increased to 19.7% from 13.3% a quarter ago, the brokerage calculated. Elara Securities raised its core earnings estimates for 2026-27 (Apr-Mar) to FY29 by 1-6% while upgrading the stock to "accumulate" from "reduce". It hiked its target price to INR 1,338 from INR 1,222. The brokerage expects the company's core earnings per share to be INR 29.1 for FY27, 41.6 for FY28, and 54.1 for FY29. However, the company sustaining higher margin is critical to meet estimates.
Systematix Shares and Stocks (India) sees a favourable risk-reward for the stock at its current market price. The brokerage upgraded Dr. Reddy's to "buy" from "hold". It revised the target price to INR 1,461. Approval for abatacept and the launch of dengue vaccine, Qdenga, can provide a meaningful boost to the company's earnings. Sales from Qdenga are expected to start flowing in from FY28. Systematix expects the pharmaceutical major's revenues to grow at a compounded annual rate of 7?tween FY26 and FY28, and profit to rise 9% during the period.
"We remain constructive on Dr Reddy's medium-term outlook, with the complex generics and biosimilar pipeline paving the way for replacing the one-time lenalidomide contribution and recovering profitability to 25%," JM Financial Institutional Securities said. The company's long-term margin aspiration is of achieving a 25% margin. JM Financial retained its "buy" call on the stock with a target price of INR 1,541.
For the September quarter, Dr. Reddy's reported an over 31% on-year fall in its consolidated bottom line to INR 9.25 billion and its revenues fell over 1% on year to INR 86.98 billion. The company's North America business, its largest revenue source, accounted for 29% of total business. Sales in the region fell 23% on-year to INR 24.89 billion, mainly due to lower lenalidomide sales. (Ruchira Kagita)
Equity Alert: Benchmarks open lower, broader markets underperform
MUMBAI--0935 IST--Frontline indices opened lower, extending their declines from Friday, led by negative sentiment from elevated crude oil prices and earnings-led moves. Brent crude oil futures were over $114 per barrel amid reports of the US and Israel planning attacks against Iran. The Nifty 50 slipped below 22500 points and struggled to remain above 22400 points too. Broader markets were worse off than the benchmarks in early trade, with small-cap indices down almost 2?ch.
At 0926 IST, the Nifty 50 was 0.9% lower from Friday at 22397.80 points and the BSE Sensex was 0.8% down at 72536.26 points. In the broader market, most top buzzers were earnings-led. Volatility also remained high, with the India VIX 6% higher at 17.82 points.
In the Nifty 50, Infosys, Dr. Reddy's Laboratories, Kotak Mahindra Bank, JSW Steel, and Shriram Finance moved in reaction to their earnings. Shriram Finance fell nearly 5% and was the worst-hit stock in the Nifty 50. The move came after the non-banking financial major said it expected its net interest margin to fall marginally to 9% in the medium term, while it may go down further to around 8.5% in the long term. In the September quarter, the net interest margin improved to 9.52% from 9.04% a quarter ago. On other hand, private lending giant, Kotak Mahindra Bank gained more than 2?ter it said it will use its foreign currency non-resident (banks) deposits to support customer asset growth. The bank expects deployment of these funds to reflect positively in its net interest margin going ahead.
Dr. Reddy's was the best performer in the 50-stock index. The pharmaceutical major rose almost 3?ter its profit and earnings before interest, taxes, depreciation, and amortisation beat the Street's view. Besides cost control, the company said a favourable change in business mix, with 53% sales from branded businesses, supported the rise in EBITDA margin. The company's EBITDA for the quarter stood at 17.83 billion, and its EBITDA margin was 20.6%.
Infosys was down over 1?ter posting a weaker-than-expected earnings for the September quarter. The Indian information technology services giant reduced its revenue growth guidance for the financial year 2026-27 (Apr-Mar) to 1-2% in constant currency terms from the earlier projection of 1.5-3.0%.
On the sectoral front, Nifty PSU Bank was the worst performer, down almost 1% and it was followed by Nifty Auto, which fell 0.5%. The Nifty Pharma index was the top gainer, up almost 1%. The rise in this index was supported by gains in Dr. Reddy's.
Despite weak sentiment across the market, a pullback cannot be ruled out. "...After the recent sharp correction, the possibility of a technical pullback or trend reversal from current levels cannot be ruled out, making the upcoming sessions particularly important," Shrikant Chouhan, head equity research at Kotak Neo, said in a note. (Ruchira Kagita)
Equity Alert: Ather Energy shares down nearly 2% ahead of Jul-Sept earnings
MUMBAI--0925 IST--Ather Energy Ltd. shares fell nearly 2% to INR 1,357, ahead of the company's September quarter earnings. The electric two-wheeler maker is expected to narrow its loss year-on-year in the September quarter, alongside strong revenue growth driven by higher vehicle sales, according to brokerages tracking the company.
Equirus Securities Pvt. Ltd. estimates the company's net loss for the September quarter at INR 693 million, while Nirmal Bang Equities Pvt. Ltd. sees it at INR 746 million. Ather Energy reported a net loss of INR 1.4 billion in the year-ago quarter and INR 508.7 million in the June quarter.
Equirus Securities and Nirmal Bang estimate the company's net sales for the September quarter to rise to INR 13.82 billion and INR 12.84 billion, respectively. The company posted revenue of INR 8.99 billion in the same period last year.
The company's overall vehicle volumes are expected to rise 42% on the year, driven by growth in electric two-wheeler sales, according to Equirus Securities. The company's average selling prices are estimated to have risen 1–2% sequentially, following recent price hikes. However, the brokerage said higher raw-material costs are expected to have partly offset the benefit of the price hikes.
Ather Energy's operating loss is likely to narrow on year, supported by growth in domestic vehicle sales, improved utilisation of manufacturing capacity and operating leverage, Nirmal Bang said.
The broader automobile sector is expected to benefit from strong domestic demand and festive-season sales. However, higher input and freight costs are likely to weigh on profitability, according to brokerages.
At 0943 IST, the company's shares were down 1.5% at INR 1,359.30. All four brokerage reports on the company available with Informist recommend a 'buy' with an average target price of INR 1,764 per share, up nearly 30% from the current market price. (Somen Bose)
Equity Alert: Brokerages up price aim on Coforge, bullish on margin growth
MUMBAI--0813 IST--Major broking firms are bullish on Coforge, expecting a healthy expansion in margins after the mid-cap information technology major posted a good set of results for the September quarter and raised its earnings before interest and taxes margin outlook for 2026-27 (Apr-Mar) to 16% from 15.5?rlier. Analysts see benefits from Encora and its artificial-intelligence capabilities as growth drivers.
The company reported a consolidated net profit of INR 5.88 billion for the September quarter, up 18% sequentially, while revenue rose nearly 12% to INR 61.71 billion. The company incurred an exceptional cost of INR 557 million related to its acquisition of Silicon Valley-based artificial intelligence firm Encora.
Coforge aims to achieve the industry's third-highest margin levels, an ambition that Nuvama considers bold but achievable. The company expects deal wins to exceed $1 billion in the December quarter, with at least eight large deals to be signed. It expects its EBIT margin to reach 17% in the March quarter and exceed 17% thereafter. Margin expansion is expected to be driven by AI-led efficiencies in existing fixed-price contracts, improved utilisation and operating leverage.
Nuvama Institutional Equities retained its 'buy' recommendation and raised its target price by 2% to INR 2,550 from INR 2,500. The brokerage cut its FY27 earnings per share estimate by 0.3?ter net sales missed estimates. Coforge's consolidated revenue fell short of the brokerage's estimate because Encora's quarter-on-quarter growth was flat. For FY28, Nuvama revised its earnings per share estimate by 1.9%, reflecting expectations of better margins.
Choice Institutional Equities maintained its 'buy' recommendation and raised its target price by nearly 9% to INR 2,320 from INR 2,135. "We view the combination of sustained deal momentum and a structurally higher margin profile as the key positives, supporting a stronger earnings trajectory," the brokerage said. Coforge's 12-month executable order book reached an all-time high following record order intake of $1.04 billion, Choice said. The brokerage flagged the company's effective integration, AI monetisation, and margin expansion as key factors to be monitored. (Utthara E. S.)
Equity Alert: Asian mkts fall amid high crude oil prices around $114/bbl
MUMBAI--0900 IST--Key indices in Asia opened lower Monday as Brent crude oil futures remained elevated around $114 per barrel amid growing concerns regarding the escalation in war in West Asia. South Korea's Kospi and China's CSI 300 were the worst hit among peers, falling 1?ch. Investors await interest rate decisions from the US Federal Reserve, the European Central Bank, and the Bank of Japan due later in the week. The central banks' commentary will further test confidence in artificial intelligence-linked stocks.
The US Federal Reserve is expected to hold interest rates steady at its October meeting Wednesday, with investors pricing in a more than 90% chance of rates remaining unchanged, according to the CME FedWatch. Investors expect a 70% chance of a 25-basis-point rate hike in December. "The main message from global central banks grappling with this year's macroeconomic surprises is that a relatively shallow rate hike cycle is underway," Bruce Kasman, global head of economics at JPMorgan, told Reuters. The Bank of Japan is also expected to keep key interest rates steady, having just raised rates in the previous month. The central bank may raise its inflation outlook for the next financial year as rising oil prices put pressure on the economy for longer than expected.
On the stocks front, Kospi major Samsung Electronics Co. fell more than 1% while SK Square Co. was down marginally. In China, heavyweights in the CSI 300 put pressure on the index. Shares of Zhongji Innolight Co. fell nearly 6% while Eoptolink Technology was down 8%. Japan's Nikkei 225 fell marginally while its broader Topix First Section was the only index in green. Technology majors in the region fell, with Advantest Corp. and Kioxia Holdings Corp. down nearly 3?ch, while Tokyo Electron fell nearly 4%.
Following are the levels of key Asian indices at 0745 IST:
|
Index |
Level |
Change in % |
|
Nikkei 225 Day |
62426.05 |
(-)0.4 |
|
TOPIX FIRST SECTION |
3984.40 |
0.5 |
|
S&P/ASX 200 Index |
8789.30 |
(-)0.1 |
|
KOSPI Index |
5501.39 |
(-)0.9 |
|
Hang Seng Index |
23106.63 |
0.1 |
|
CSI 300 Index |
4064.72 |
(-)1.0 |
|
FTSE Singapore Strait Times |
5415.68 |
(-)0.1 |
(Vidhi Thacker)
Equity Alert: Nifty to open flat as oil weighs on sentiment; IT cos in focus
MUMBAI--0845 IST--Benchmark indices are set to begin a week of heavy earnings announcements on a subdued note. Ongoing attacks by Iran-backed Houthi forces on Saudi Arabia's oil facilities are likely to heighten concerns about oil supplies and dampen market sentiment in the near term, analysts noted. Information technology stocks are likely to be in focus after sector major Infosys missed the Street's estimate for net profit in the September quarter. Weak cues from early trading in global markets are also expected to weigh on sentiment.
At 0800 IST, Brent crude oil December futures were at $115 per barrel, down almost 2% from Friday. They had hit an intraday high of $117.45 a barrel Friday, their highest since April. Crude oil futures are nearly 58% higher since the war in West Asia started. At these levels, analysts said oil prices continue to be a headwind for the domestic market. The fall in crude oil prices Monday is likely a technical correction, Dow Jones Newswires reported.
Benchmark Indian equity indices ended lower for the fourth straight session on Friday. The Nifty 50 ended at 22600 points, down 87.65 points or 0.4%, while the BSE Sensex ended at 73123.83 points, down 125.56 points or 0.2%. In the near term, the 50-stock index is expected to find support at 22480-22370, while its resistance is pegged at 22730–22850 points, according to technical analysts. At 0810 IST, Gift Nifty October futures were at 22608 points, nearly flat from the Nifty 50's previous close.
Information technology stocks will be in focus after sector major Infosys reported only marginal sequential growth in its consolidated net profit for the September quarter to INR 78.23 billion, below the Street's view. The company slashed its sales growth guidance for the current financial year to 1–2% in constant currency terms from its earlier projection of 1.5-3%, citing macroeconomic uncertainty and pricing pressure. Following its results, Infosys' American Depositary Receipts ended nearly 7% lower Friday.
Shares of Kotak Mahindra Bank will also be in focus after the lender reported healthy net profit growth for the September quarter, driven by a sharp fall in provisions and growth in advances. Shares of Tata Consumer Products will also be in focus ahead of its September quarter results.
Most Asian indices were lower in early trade Monday, with the South Korean Kospi and China's CSI 300 shedding over 1?ch and the Nikkei 225 index down 0.4%. Investors will focus on key central bank decisions and China's Fifth Plenum meeting. The US Federal Reserve, the European Central Bank, and the Bank of Japan will all announce their rate decisions Wednesday, Thursday and Friday, respectively. (Shruti Nair)
Equity Alert: Infosys Q2 disappoints Street, analysts wary of margin growth
MUMBAI--0745 IST--Infosys posted a weak set of earnings for the quarter-ended September. The Indian information technology services giant reduced its revenue growth guidance for the financial year 2026-27 (Apr-Mar) to 1-2% in constant currency terms from the earlier projection of 1.5-3.0%. The company, however, retained its operating margin guidance at 20-22%. The lowered guidance dampened sentiment for the stock. Analysts are mixed on how deals will shape up through the rest of this financial year, and the company's margins are seen as being adversely impacted.
The second half of this fiscal year is expected to be weaker than has historically been witnessed for the information technology major and, hence, outlook on the company stays weak in the near term. Nuvama Institutional Equities said in a report. However, the stock's inexpensive valuations limit downside. The brokerage tweaked its estimates for the company's earnings per share by 0.1% for FY27 and by 0.5% for FY28. Nuvama downgraded the stock to "hold" from "buy" with a target price of INR 1,200. The earlier target price was INR 1,250. Going forward, there is likely going to be a ramp-down of deals and this is likely to lead to a weak exit rate for FY27. Nuvama expects Infosys to underperform its large-cap and mid-cap peers in the IT space.
For the September quarter, the IT major's earnings before interest and tax margin missed Emkay Global Financial Services' estimates. The company's EBIT margin came in at 21%, which was 50 basis points below expectations. Wage hikes split across the December and March quarters, softer revenue seasonality, artificial intelligence-driven productivity pass-throughs, and ramp-up of large deals are seen weighing down the company's margins in the remaining financial year. While Emkay Global cut its earnings per share estimates by 0.8-1.5% for FY27-29, it retained its "buy" stance and kept its target price unchanged at INR 1,300 on an "undemanding" valuation.
Though strong deal bookings, hiring, and accelerating AI revenue were positives for Infosys during Jul-Sept, AI-led deflation, exposure to high application-services, and competition may constrain growth in the medium term, Systematix Shares and Stocks (India) said. Infosys' large deal total contract value stood at $5.2 billion for the September quarter, including a mega deal worth more than $2 billion. There is a lack of evidence of a broad-based recovery in the second half of FY27, the brokerage said. Although the financial services division and the energy, utilities, resources, and services vertical are expected to grow faster than the company average, competition may constrain near-term spending. Systematix maintained its "hold" recommendation on the stock with a target price of INR 1,150 while trimming its earnings projections for FY27-29 by 0-0.6%.
Infosys' consolidated net profit for the September quarter rose marginally sequentially to INR 78.23 billion while its revenues from operations rose over 2% sequentially to INR 492.44 billion. The company had reported its earnings after market hours. Friday, its shares closed flat at INR 1,153.80 on the National Stock Exchange. (Ruchira Kagita)
Equity Alert: US indices down as consumer staples, healthcare stocks fall
MUMBAI--0735 IST--Major US indices closed lower Friday as consumer staples, utilities, and healthcare shares fell. Brent Crude oil futures rose further and ended at $116 per barrel, its highest level since April. Oil prices rose after reports that the US and Israel may be planning fresh attacks on Iran. In response, Iran said it is prepared to strike back. Among indices, the Dow Jones Industrial Average was the worst hit, falling more than 1%.
On a weekly basis, the tech-heavy Nasdaq Composite fell the most, down nearly 1% as investors assessed the impact of major technology companies borrowing and funding their artificial intelligence infrastructure. However, technology majors Micron Technology and Advanced Micro Devices rebounded Friday, rising around 2?ch. SK Hynix also recovered, gaining 4%.
"For the last two weeks, investors have been sprinting from tech stocks and data centre beneficiary stocks to safe stuff, and eventually, you run out of people willing to do that sprint, and that's what today looks like and feels like," Jed Ellerbroek, portfolio manager at Argent Capital Management, told CNBC.
Major US healthcare stocks fell, with Eli Lilly and Co. losing more than 2%, while Johnson & Johnson and Merck & Co. declined over 1?ch. Consumer staples also weighed on the indices, with Procter & Gamble Co. and Costco Wholesale Corp. falling around 2% and 1% respectively. Dow Jones component American Express fell nearly 4?ter announcing plans to cut 5% of its global workforce to "prepare for AI," according to CNBC.
Shares of discount retailers fell, with Dollar Tree and Dollar General Corp. down more than 4?ch after Wells Fargo analysts said in a note that rising diesel prices could pressure profits in the second half of the year and next year. Wells Fargo said Dollar Tree is most affected and estimates high fuel costs will weigh about 50 basis points on margin.
Following are the closing levels of key US indices:
|
Index |
Level |
Change in % |
|
Dow Jones Industrial Average |
52215.61 | (-)1.2 |
|
NASDAQ Composite |
25955.34 | (-)0.2 |
|
S&P 500 |
7623.68 | (-)0.5 |
(Vidhi Thacker)
US$1 = INR 95.15
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Himanshi Gupta
All prices from National Stock Exchange, unless otherwise specified.
All percentage changes for share prices are rounded off to the nearest whole number; percentage changes for index values are rounded off to one decimal place.
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